The development of the nose, eye and ear all share a common feature during ontogeny: a primary component of each sensory organ (olfactory epithelium, lens and inner ear, respectively) is derived from ectoderm adjacent to a component of each sensory system derived from the central nervous system (olfactory bulb, retina and hindbrain, respectively). In each case inductive interactions between the CNS and ectodermal components of these tissues have been implicated. While the interactions between retina and lens have been relatively well characterized, far less is known about those leading to formation of the olfactory system and inner ear. The aim of the work proposed here is to elucidate inductive interactions in these sensory systems. In this second revision the primary change has been to remove three of eight original aims to address concerns that the proposal was too. The first goal in this proposal is to clarify important early tissue interactions leading to the formation of the olfactory epithelium during early development of Xenopus laevis an organism particularly amenable to such studies. The basic parameters of olfactory induction will be determined by transplantation experiments while tissue recombinants in culture will be used to refine the tissue interactions required for formation of olfactory tissues. While our recent work has clarified some of the important interactions required for the early phases of otic vesicle determination in Xenopus we now plan, as our second goal, to investigate how subsequent inductive interactions lead to determinati9n of the highly regionalized tissues within the inner ear. These studies will not only give us important new insights into the developmental mechanisms controlling olfactory and auditory development, they will provide essential information for assessing the intriguing proposal that all of these sensory tissues are determined by common mechanisms. They will also provide a strong basis for undertaking studies to identify signaling molecules that control sensory tissue formation. In addition, understanding the ontogeny of olfactory and auditory development will provide important insights into processes that bear on a number of diseases affecting these tissues.